John Roberts, newly CNN, did the report. Both were nominated for their current positions during the summer of 2005. So two men, who were nominated six and seven months ago just made this decision about our ports. And they forgot to mention it to their bosses until a few days ago. John Roberts reports "Lowery says that committee's deliberations have to be secret to protect proprietary corporate information. And, unless there is a national security concern, which, in this case, he insists there wasn't, there is no need to notify Congress, or even the president."
CFIUS is The Treasury Department Committee on Foreign Investment in the United States, which is represented by twelve member departments in the Executive branch, and is the committee which approved the Dubai Ports World port deal.
Stewart A. Baker...
JOHN ROBERTS, CNN SENIOR NATIONAL CORRESPONDENT (voice-over): (AUDIO GAP) a process guarded by secrecy. So, who signed off on the deal? CNN has learned, the two main players on the Committee for Foreign Investment in the United States were Stewart Baker, from the Department of Homeland Security, and the Treasury Department's Clay Lowery. And, yes, they feel stunned by this enormous backlash.
(on camera): You know the way that this is being portrayed. You know, who -- who -- who are the dunderheads who made this decision? Does -- does that perception trouble you?
CLAY LOWERY, ASSISTANT SECRETARY FOR INTERNATIONAL AFFAIRS, DEPARTMENT OF THE TREASURY: I think it does to a degree, I mean, as one of the, I guess, the leader dunderheads.
ROBERTS: The pending sale of terminal operations at six East Coast ports has thrown new scrutiny on the process and whether the committee, formed during the Cold War, operates within the new realities of the war on terror.
Clark Kent Ervin, former inspector general at the Department of Homeland Security, and a CNN analyst, believes, CFIUS, as it's called, is sorely in need of reform.
CLARK KENT ERVIN, CNN SECURITY ANALYST: If treaties and trade agreements are important enough to require congressional approval, it seems to me that the sale or acquisition of a key strategic asset in the age of terror, likewise, requires congressional sign-off.
ROBERTS: Ervin isn't the only one who has problems with CFIUS. Last September, the Government Accountability Office issued a report critical of the committee's narrow definition of what constitutes a threat to national security. It also faulted the opaque nature of the process, limiting information provided to Congress.
Lowery says that committee's deliberations have to be secret to protect proprietary corporate information. And, unless there is a national security concern, which, in this case, he insists there wasn't, there is no need to notify Congress, or even the president.
LOWERY: The president not knowing about it is -- shouldn't shock people, in that we -- there's a number of transactions that happen every year. I believe there were 65 last year.
ROBERTS: In fact, we learned today, Lowery's boss, the secretary of the treasury, was in the dark, until after the deal had been signed off on.
That staffers made such a sensitive decision, and without involving their superiors, say critics, is a troubling sign of creeping complacency in the war on terror. ERVIN: I think America, frankly, is in danger of having gone back to sleep. Because we haven't been attacked in five years, we're beginning to assume -- whether we're conscious of it or not -- that we're never going to be attacked again.
The President intends to nominate Stewart A. Baker, of Virginia, to be an Assistant Secretary of Homeland Security (Policy). Mr. Baker is currently a Partner with Steptoe & Johnson, LLP in Washington, D.C. He previously served as General Counsel for the Commission on the Intelligence Capabilities of the United States Regarding Weapons of Mass Destruction. Prior to that, Mr. Baker served as General Counsel for the National Security Agency. Earlier in his career, he was a law clerk for Justice John Paul Stevens, U.S. Supreme Court. Mr. Baker received his bachelor's degree from Brown University and his J.D. from the University of California, Los Angeles.
http://www.whitehouse.gov/... (July 13, 2005)
The President intends to nominate Clay Lowery, of Virginia, to be Deputy Under Secretary of the Treasury (International Affairs). Upon confirmation, the President intends to designate him Assistant Secretary of the Treasury (International Affairs). Mr. Lowery currently serves as Vice President for Markets and Sector Assessments at Millennium Challenge Corporation. He previously served as Deputy Assistant Secretary for Debt and Development Finance at the Department of Treasury. Prior to that, he was Director for International Finance for the National Security Council. Mr. Lowery received his bachelor's degree from the University of Virginia and his master's degree from the London School of Economics.
http://www.whitehouse.gov/... (August 23, 2005)